Balancing the Books

Henry Kaufman's Latest Prescription

Henry Kaufman's latest.

THE ORIGINAL DOCTOR DOOM IS BACK, with some fresh warnings. Henry Kaufman, famous for his bearish views in the 1970s and '80s, now takes up the financial crisis of the past year and urges major reforms.

Kaufman blames poor policy planning for allowing debt financing to grow too quickly for much of the past 25 years. There was a continual substitution of debt in place of equity for financial firms,...